Skip to main content

tv   Countdown  Bloomberg  June 3, 2014 1:00am-3:01am EDT

1:00 am
>> more signs of stability in china. the latest age rises to a four-month high. >> the news boosts stocks. >> president obama to europe. a $1 a visit to unveil billion fund for european security.
1:01 am
hello and welcome to "countdown." >> a warm welcome to the program. it is 6 a.m. on monday -- in london this tuesday morning. is in berlin with the details of apple's new software. >> we have a breakdown of china's manufacturing data from hong kong and as president obama kicks off his european tour ryan more. nextll tell us hour on countdown. of the ukraine crisis on investing in russia with the cfo of royal dutch shell. commodities and other exclusive compensation with the chief executive of rio tinto.
1:02 am
later this evening goldman sachs chief executive lloyd link find and michael bloomberg said down for an exclusive conversation. do not miss that interview at 6:30 p.m. london time. to our topt back story. apple wants to help you control your health and her home. they introduced new software for the iphone and the ipad edits annual developer on france and san francisco. to talkhols joins us
1:03 am
tech. where is apple leading and where are they playing catch-up? rex i think that is an accurate way to look at it. when you look at where they are apple wants to have parity. they want to be in a position when they will launch their watch emma they want to have a platform to fully control your health. and the cloud computing, apple is clearly behind and this was an attempt
1:04 am
to catch up with the whatsapp of the world and dropbox. they want to have a fully between yourstem ipad and iphone, maybe even windows. here is tim cook describing the new operating system. if i receive a notification if i get one just then i can swipe across. i have actions, i can accept or decline this meeting. i will use the device, and laying some music here. just swipe down and i get access to my keyboard. i can type array there. i swipe to the side and i have access to all my favorites. i will launch the mail. i have a number of unread messages so let's work our way through.
1:05 am
message with a dinner appointment. you notice -- company that has elegance, they switched to a coding system. , 13.oungest developer the new system got a lot of applause. they should have said make an app with this new code. >> this is supposed to be a conference for developers. i understand dr. dre might have made an appearance. >> he made a virtual appearance and cause -- asked what time he should show up for work. dr. dre gives it a little bit of cool. open for their app store to allow payment from virtual currencies. it was clear where they are heading. can -- you can download and pay with the stash of bitcoin. >> hans nichols joining us from berlin. >> asian stocks rising for a second day. we had data on services as well. david joins us with the details. what was the take away from the numbers? >> he means that things are stabilizing. they put out the numbers as you mentioned. than thettle softer initial reading. the take away is if you compared to april and keep in mind the official numbers we had
1:06 am
yesterday. we did see a stark improvement. that was the biggest improvement . a four-month high right now which suggests that business conditions have improved on the ground. hsbc's reading is more focused. youaller sample size and look at private companies so does give you an indication of where the pain has been most felt. we did see an improvement in sentiment. economist went on to say that it is too early to conclude that china has bottomed out. mainly because of the property or. that is the wild-card card race here but it depends on whether lose on the will fiscal and monetary side. >> just staying with chinese news trade we have news that google services are being
1:07 am
affected as beijing tightens control. what do we know, what is all this about? >> it is not surprising. june 4 marks the 25th anniversary of the event. topic forry touchy the chinese government. censorsen the state tighten control. those are the services that have in blocked since last week. i have checked with several people and what they're saying is there have been disruptions. sometimes it works and if it does it is very slow. extensivelyhecked on their end and they are saying there is no technical problem which points to what we all know.
1:08 am
it is not the first time this has happened. our website has been blocked in china for about a yeaeait is a touchy subject her. when you have ethnic tensions and a lot of discontent and corruption as well. you do understand why perhaps they are doing this. but then it does not mean a lot of people will agree with how they are doing these things. back to. president obama touches down in poland kicking off his four-day european tour. the trip comes amid some of the highest tension since the cold war. oft is the significance starting the tour in warsaw? rex he is reassuring the polls
1:09 am
that the u.s. stands with them. there's a lot of concern that the u.s. is amidst a pivot toward asia. these economic sanctions has been threatening against russia to punish them for the annexation of crimea are not happening. this is a way of saying we support you. he will announce a european reassurance to boost offensive capabilities. we have sent f-16s to poland. we have sent a company from the 173rd airborne brigade they stay in italy. this is another visual way of saying the u.s. stands with you. two key are anniversaries taking place. one in poland. >> didi on friday. when they came in oakland the western front.
1:10 am
is freedom day in poland. the 21st anniversary of the first free elections as the soviet union and the soviet bloc fell apart. the primenk about it minister telling me we are moving toward a cold war. beingeel like they are reconstituted as the soviet union. and the u.s. is becoming an enemy. all of europe is now a new ground for competition between these different models. russia is not the soviet union anymore but it is an autocratic model. this is what you're seeing here. you could not get any more symbolic than obama showing up on the eve of this anniversary. i think that is part of the
1:11 am
message. onwhat is the state of play the ground? rex we had that attack yesterday morning. hundreds of rebels involved in this attack that went on throughout the morning. and then about midday we had a massive explosion in the administrative building in the city of luhansk. out that it looks like it was in antiaircraft missile that the rebels were using against ukrainian aircraft that went astray. 12 people killed in the fighting yesterday. we had those gas talks in brussels which appeared to be somewhat successful. >> we have had another week extension. >> they agreed to meet again late this week or early next week. the russians agreed to put off that idea of prepayment and they agreed to a deal that would last for one year. they have tightened up the scope. if you
1:12 am
look at the russian market the month of may, stocks rose by 12%. their best month in a very long time. the market thinks that de-escalation has begun. thanks very much. the latest on ukraine and the geopolitical events taking place this week. >> will get reaction to the countdown."t on " ♪ >> time for today's company
1:13 am
1:14 am
1:15 am
news. apple has unveiled new health and home connected features. including health kits that let able monitor their health and allowing people to control garage doors and locks from their phone. a person with knowledge of the matter said the cuts amount to about five percent of the workforce in the region. google services are facing blocks ahead of the 25th anniversary of the tiananmen square crackdown.
1:16 am
searches have been blocked in china since late last week. welcome back. >> the time in london is 6:50 a.m. is the economy stabilizing? us.ael o'sullivan -- joins is the economy stabilizing? it caught her range of small companies. you had i would call it stealth and we also had currency weakness. that had been telegraphed as a technical move. morelet the currency move
1:17 am
than what people expected. are property prices coming off the highs and we have not had a good recession in china. you -- watching property prices carefully and watching profits and profit margins of chinese companies because there is a lot of operational gearing. >> does the tension around events and geopolitical that are in focus, are they on have theylist or moved lower down? rex it has moved down. had the crisis happened we a buy recommendation and we stuck with that. the market has rebounded quite nicely. the unfortunate tension and fighting is still there. there is an opportunity with the world leaders gathering this week to begin to have some serious dialogue.
1:18 am
this unsatisfactory status quo will persist. ukraine not have the one else will have it either. >> try and say something that has not been said. >> it is all heavily choreographed. what has not been focused on is the way that the ecb will get the small and medium enterprise. you hear a bit more in the statement about institutions like the european investment bank. we will hear more detail on how some of the thinking layers will
1:19 am
play a role in getting liquidity. more about demand for credit. a lot of focus is on supply. >> we had a guest on yesterday who said there is not that much demand. it is a supply issue. the ecbig issue that and authorities are looking at is deleveraging. also a situation where small businesses, many of them are real estate ventures. sort of dressed up as businesses. many entrepreneurs do not have the confidence to launch new product. credit is demand for an issue. >> anything that we could hear in unemployment data? , we havenk the market
1:20 am
peaked in terms of the momentum of the macro numbers. the market disappointed on thursday. european markets are very short term. >> thank you. invest.ghts on where to when we come back. ♪ >> it worked well not just for
1:21 am
1:22 am
1:23 am
the middle east and hong kong market but he on the middle east to europe and africa and the middle east countries and beyond hong kong. in the end the consumer wins. pacific ceothe café speaking from the gathering in the airline industry in qatar this week. >> welcome back. , how wouldo'sullivan you explain the behavior investors where they are pushing yields on 10 year treasuries and at the same time they're buying german shares, pushing the decks
1:24 am
to an all-time high. how would you explain that? rex with great difficulty. there's a couple of things going on in terms of positioning. pension institutional fund minded investors are eyeing you in the treasury market and holding on. in equity markets we have this strange drift higher. twolast 20 years we had periods where the vix has stayed for 60 or 70level days. we are entering into that right now. toh of those were related various bubbles and it ended
1:25 am
badly. there is a positioning effect. the macro news that underlies market is pretty good but i do think there is a sense of complacency. the underlying explanation is that markets have been and we have become enthralled with these big qe programs. they were supposed to be unconventional. you have talked in the past about investing in hedge funds. where are you with your investments? rex we look a lot at hedge funds for our clients. the performance within different hedge funds started across the industry and it has been very mixed. it has been a difficult environment for normal investors and hedge funds.
1:26 am
budgets are being cut back. >> it can be tough for them. >> you could take a number of approaches. if you look at hedge funds styles, the arab funds have done very well. there is one or two that have done very well on the short and long side create if you are a contrarian there are some hedge funds that have not done that set up foro might be the rest of the year. if you want more structural way to play volatility some of the macro funds might be a good idea. just go alonghink bonds and long equities. would that be at stupid decision to make? the rulestake all of of investing we were talking about recovery in the business
1:27 am
cycles. we were long stocks and short bonds. much. k you very ♪
1:28 am
1:29 am
1:30 am
>> we're looking at the euro this morning. all eyes on that inflation data wreaking later today. will inflation slow as anticipated?
1:31 am
1:32 am
1:33 am
1:34 am
1:35 am
1:36 am
1:37 am
1:38 am
we are getting a little bit of a reprieve. up ever so slightly. some interesting comments. euroman paper saying the strength is temporary. not enough of a reason to cut interest rates. he sees no danger of deflation but still the market is very much looking to ecb to unveil sunsetted stimulus later in the week. june 15 is when we get mario draghi taking to the stage.
1:39 am
>> thank you. these are the bloomberg top headlines. the u.s. department of justice has disabled at hacking network that generated losses of $100 million or more internationally. it announced charges against -- behind the game. authorities are urging computer to run thorough scans in the next two weeks to remove the viruses from their computers. a dozen people are dead in the province after clashes. insurgents attacked and people died in a blast rebels say came from an airstrike. the key rates with at 2.5% for the 10th month. >> the central bank of india has left rates unchanged for the second straight meeting. this is an -- a nine day old government. predicted by all 38 a numbered news survey. the r.b.i says that further policy tightening will not be warranted if consumer price inflation stays on course to hit percent in january 2015 and six percent a year later. if this inflation is faster than its is dated it could revive headroom for easing of the inflation. consumer price gains did a .5% which is the among 18 asian economies. has slowed and if it continues to slow there will be no need to tighten policy. there might be a need to ease policy. >> and the sensex hit another record. 17% year to date. apple's new product unveiled at project --ers conference. operating system at project in the pipeline? >> this was the developer conference and there have been a
1:40 am
few hints of hardware not -- launches. we saw none of that. we saw a updates to existing and laying the foundation for future business .round >> let's talk about those foundations. health kit and home kit. what are they? >> we do not have enough information yet. are light on the details. what they're doing is quite interesting. out when youding extend your house you know the foundation. that is what they're doing here. they're doing it as a platform. about applebe just products. they want to be the people who systemsdata through the and control that bit. >> you will be able to switch her lights on with your iphone and so forth. is interestinge because it is a very messy market. ands of different products apple is trying to bring that together under one system. and legitimizing that whole area. >> they're doing tieups with other companies. for are they revealing their own hardware? >> a bit like the app store. to usea lot of people their systems and enable a much bigger market. >> it has been criticized as closed. >> some people pointed to that as one of the strengths. >> we think that openness is important. it had a more relaxed style not used to seeing. the apps onallowing the device to talk to each other. also this enabling the ecosystem. we think it is a new style. >> the biggest in the piece came announced their new language. means. >> itthat writing appsoing which is more efficient and it works faster on the machine. can live side-by-side with the existing code so you do not to completely learn everything and switch over. this is just technical progress. >> and progress in storing and sending files, should that be welcomed? >> that is right. been criticized for what it does on the web and its services. weaker and here we saw them taking on dropbox and bits of facebook and snapchat and areag to strengthen that out to position themselves. i think there was quite a lot of catch-up. >> they talked about the number defectingwho were onto their devices and they are on china as an important part of their business. terms ofis huge in where that growth comes from.
1:41 am
he talked about people defecting from android to apple. but -- bit going the other way. that has been a worry android is so big that developers focus on android. apple was trying to pull them back again. who is in the lead would you say right now when it comes to those services? >> it is difficult. there are a number of large players. developer its big conference in a couple of weeks. its conference at the moment. they are moving forward in ways at slightly different speeds. >> we -- where we heading on hardware? we're still waiting for this wearable device when and if that comes out. do you think that will be announced later this year? there are high hopes. >> there are high hopes. we might see a slightly bigger iphone. is it time for a new ipad refreshed? it is early to speculate. you for joining us. us from >> geeking out trousers -- company that is making the business of choosing an outfit easier. that is next. ♪ companyfor today's
1:42 am
news. intercontinental hotels chief richard sullivan says his company does not need a merger or takeover in order to grow. he declined to comment on speculation it had taken over half of the kind -- company. it had received a bid valued at 6 billion pounds. and the largest search operator is set to start trading. this coincides with the government cutting dependence on foreign exchanges. it is listed in new york. tumbledreme doughnuts 14% after cutting its earnings company cites sluggish first-quarter sales and mounting costs. the company is struggling with higher than anticipated costs
1:43 am
for its new planning system. "countdown."to thehe good, the bad, ugly, and the beautiful all get rejected from berlin's legendary nightclub. that would not stop hans nichols from trying when he enlisted the help of a berlin shopping started to help them look the part. >> your outfit in a box. direct. ood shipped griffin.a male to a rathered dangerous challenge. dress me hip enough for the cities most famous nightclub. phoneer online, have a
1:44 am
consult with one of 60 stylists, and your personalized rocks will arrive 10 days later. 10 daysill arrive later. >> it is about impressing your girl. >> flush with 13 million euros, servicesy is offering in four countries. -- it is the same for american men. >> even italian men? >> they are little bit special. >> each arrives with a note from rnur stylist and some ste german instructions. this is the first outfit. >> looks good. >> it seems a little tight. >> we could get the chino one size bigger. >> it seems i am advertising. >> outfit cost them a 300 58 euros.
1:45 am
with the jacket another 250. my next outfit would set me back war than 500 euros. what a job like i can ship that -- back free of charge. >> things are not too tight? >> the size is really good. >> here's the box that will put -- we will put to the test. total price 340 euros. >> this is what will get me into bergheim's. >> put on the hat. >> put on the hat? >> we roll up these. >> i look like i deal crystal meth. >> you don't look like a meth head or anything. you look like a lot of guys
1:46 am
here. >> this is 6:30 a.m. and this place is still going strong. i will see of i can get in with this outfit. we are going commando on the camera. it is concealed. as you can see there is not much of a line. victory. inside there is romanesque decadence. after one beer i leave in triumph that with a limp and not from the clubbing. the stock martin's do not quite fit. tens do not quite fit. >> i am confident i will never wear this outfit again. is brave enough to join us from berlin. it cool for you perhaps. >> you will not need a second source. urce toneed a sor confirm if you were in one of these decadent clubs. one source says you were out all night. >> i wanted to ask you. do they stay up until 6:30 a.m. or did you get up early and go
1:47 am
straight to the club? the latter is not how you're supposed to do it. >> you're not supposed to be a andd dad and get that five go and then cook your family pancakes. the cofounders of this company, we weree at the company reporting ongoing ipo. there is a serious side to the story. these berlin startups have been incubated but 13 million euros in startup money. we will see whether or not their model takes off. models in the states have taken off. get your outfits in a box. we will sign you up. >> it is all about impressing the girls. did you impress the girl that you have at home? >> here's what i was challenging
1:48 am
on. you are helping guys dress cool to get girls. this is a family television show so we will not use colorful language and she sort of lanced a lottaisted that no, people are in relationships already. what they find is in the first year of a relationship they tryd back and they do not to send any boxes. perhaps the girlfriend or spouse or partner gets tired of dressing their husband or their man. and they call an outfitter. they call in the pros. you the link. >> i do need it. >> thank you very much. very brave on assignment in berlin. economicors digesting data from china. signs of stabilization maybe. here with a bit more on the effect on the markets is our business correspondent caroline hyde. it seems as if markets are responding in that way.
1:49 am
>> asian stocks are getting a bit of a lift. even though the hsbc market number for manufacturing missed and did not come and where analysts had been hoping. we had 49.4, still contraction the fastest in four months so we are getting some traction. it incorporates what we saw yesterday with the official communist party numbers. government official figures showing that it was an expansion and it was the best in five months. people are not expecting a sudden turnaround create we are expecting the government with the tentative stimulus measures they have been taking. they're trying to pump money faster into the economy. they are splurging on the railway. the fact that they are keeping a close eye on jobs and trying to suppress a property bubble but they are trying to keep the wheels well oiled at the moment.
1:50 am
ofare staying in the realm 7.5% growth. people are easing a little bit. >> that is the government's target. we have some data out later today. data outave inflation for the eurozone. >> is not pretty. 0.6%, way off the 2% level. this is the price of stability. >> if you factor in commodity prices coming down and oil prices coming down, this is what mario draghi said last month. he said we should not be too worried about the strength of the euro. this is not a reason to be
1:51 am
cutting rates. monetary policy should not be affected by your currency strength. many people feel that that 0.6% inflation will send a shiver down mario draghi's spine. rate cuts, here we come. femalebattle of male vs. continues. it is about hurricanes. that is next. ♪
1:52 am
1:53 am
what have you got? >> i have got something from b ild.
1:54 am
ond had interview with him his way to the jailhouse. he showed up there for his 2.5 years sentence for tax evasion. the charge was he confessed to it because they were offering amnesty but the court said no. we are on your case anyway. he did not confess for the right reasons. foot all her and president of manchester united. imagine if jeffrey hearst went to prison. i do not know what you would say. >> i would be upset. the world cup hero of 1966. am talking about hurricanes. apparently if you have a hurricane with a female name more likely that more people will die because people do not take it seriously enough. bike -- likemed katrina or dolly.
1:55 am
there is a fivefold increase in the number of fatalities when the hurricane is female because people do take it -- do not take it seriously enough. they underestimate the danger. is --gly enough the name seems to stop people from running away. of aked the front pages couple of pages. there is the handover of power. this is king carlos on the left passing the throne to his crown prince. this is from the front page of the guardian. they decided to go with the new i understand she was a tv presenter. >> she worked at bluebird four hours banish language channel many years ago.
1:56 am
-- bloomberg for our spanish language channel many years ago. pe abdicated, that has not happened in 600 years. toughurray has had a year. he has not won a title. he had back surgery and he was out for four months. fernando vedasco. clay is not his favorite surface but he is through to the crowds -- we. the know who the crowds will be going for. wimbledon is three months -- three weeks away. about. -- good luck.
1:57 am
play? -- obably -[inaudible] in the final. "countdown" continues in the next hour. stay with us. ♪
1:58 am
1:59 am
2:00 am
>> the latest manufacturing gauge rises to a four-month high. >> the news posts asian markets. stocks hit their highest level in more than six years. >> president obama heads to europe. he is visiting poland to unveil a fund for european security.
2:01 am
hollande welcome. >> the time in london is 7 a.m. a warm welcome back to the program. reporters are standing by ready to deliver the stories that will start your day. we have details on apple's new software. >> as president obama kicks off his european tour ryan chilcote will tell us what is on the agenda. a successor tod alexander friedman as the cio of that business. impacts will look at the of the ukraine crisis on investing in russia with the cfo andoyal dutch shell, siam -- simon henry. goldman sachs chief
2:02 am
executive lloyd like find and bloomberg founder michael bloomberg said down for an exclusive conversation. do not miss that interview at 6:30 p.m. london time. wants to help you control your health and your home. the company introduced new software for the iphone and ipad at its annual developer conference in san francisco. hans nichols joins us to talk tech. whereis apple leading and are they playing catch-up? we had a bit of both here. accurate tor and say that playing catch up on messaging and fully integrating to the cloud and that is one thing they are making a push for. there may be more parity and they want to be in a position to take off on health. new they did was unveil a code, a new operating system.
2:03 am
announcing i was -- ios8. [applause] ios8 is a giant release and it is two stories, not one. it has great end-user features. it also has incredible developer features, so you can extend your experience and build apps that you could not do before. >> what apple is trying to do here, there is still -- they are still a hardware company but they want to get the cred from the coders. >> i am no good at swift.
2:04 am
the new alphabets from apple. listed as a developer from apple? >> he asked what time he had to show up to work. apple is acquiring beats. they still want to have cool and elegant devices. you do not have a lot of innovation. they have been static create all the movement is on software. apple is playing catch-up especially on cloud computing. >> thank you very much. >> asian stocks trading up and investors digesting more economic data from china. signs of stabilization.
2:05 am
>> asian stocks are on a bit of a role and it will likely help the rest of the trading day. her -- aa bit of relief. . we had manufacturing data from the government and it -- the official number was growth. and the hsbc number came out still and contraction. it is the biggest jump we have had in almost a year. month on month. just missed economist forecasts but it is still enough to give relief that we are seeing stabilization. our economy is stabilizing but it is too early to say that it has autumn doubt. they want to see a little bit more boost in terms of monetary and fiscal policy and they have been getting that.
2:06 am
they have been having the government focused on boosting lending. the banks they say if you are lending to the small businesses and also has been faster. we will get data later on from europe. inflation data. economists are expecting the ecb to cut rates so it is interesting to wonder whether anything that comes out in the data will change anybody's mind. off theis still way target. there has been much lip service paid to the concerns about deflation. the chief economist of the ecb has been writing about having an interview with the german paper. is due to prices falling and this is stable.
2:07 am
this is not deflation yet. there should not be a reason to boost stimulus and unveil monetary policy. neither should the strength of the euro. this is a three-month low because of this anticipation that we will see interest-rate cut. everyone looking to june 5 and focusing on what mario draghi will do and the expectation is to see a negative deposit rate. we are saying lending to the smaller businesses in particular. all eyes on inflation data and unemployment. 11.8%. compare that to the u.s. where they have two percent inflation and unemployment at half of the eurozone and they have manufacturing on the rise
2:08 am
significantly. >> very interesting comments coming from the former ecb chief economist. rise that is year the highest. we're seeing an 11.1 increase. nationwide said that the main house price increases, we are talking about one month's worth. said michaelhere brown is stepping down. >> last september shares well above their listing price. it is one of the beneficiaries of a rising market. >> president obama kicking off his four-day european tour. a risingat is called
2:09 am
amount of tension. oft is the significance starting this tour in warsaw? >> it is about telling eastern europe that the u.s. is there to support them. even though military if necessary after russia's annexation of crimea. we understand he may announce today the european reassurance fund, $1 billion that would be for eastern europe to boost their defenses. that is the main message. we did not just pay attention to france, the u.k. but we are concerned with your situation as well. >> it is symbolic that he is arriving in europe this week because there are two key anniversaries. 70there is the anniversary. >> we have freedom day in
2:10 am
poland. firstniversary of their free election in the collapse of the soviet bloc in 1989. even before that when he arrives the russian newspaper reporting that he is going to pose with f-16 fighter pilots in a hangar. that is a real message with the u.s. sending f-16s to poland for patrolling missions along the eastern border. it is all very geopolitical and cold war. the russian premised are told me we are moving toward another cold war. you have this competition, the struggle between the west, western europe, although it seems a bit more reluctant to get into the struggle and russia .ighting over europe particularly crimea.
2:11 am
that is a message that president obama is aware of. not just giving to the polls but ofre will be 10 leaders european countries and will the -- as will the president-elect of ukraine. >> what is happening on the ground question mark >> we had a at the -- luhansk. the rebels were saying it was a ukrainian government airstrike and then the rebels acknowledged maybe it was one of their own antiaircraft missiles that went astray and hit the building. ground.a second battle the -- the russians said they would work on a deal that would be valid for one year so they made things a bit more manageable. you look at the russian market,
2:12 am
it is pretty extraordinary. of may, russian stocks rose by 12%. yesterday they were more than two percent. investors believe that the escalation is on the way. i might disagree. >> was it an astute move by putin? gathers on tuesday. >> both ukraine and russia have time. it is hot in ukraine. they need to fill up the reserves to get ready for the winter. they have enough time to do that. the ukrainians are pumping four times more gas right now than they did this time a year ago. they are getting ready. ubs named a new cio. we will be talking to him about his investment strategy right
2:13 am
after the break.
2:14 am
2:15 am
>> welcome back. >> it is a quarter past seven in london. >> you bs has appointed a new
2:16 am
ceo -- ubs has appointed a new haefele. congratulations on your new role. what does the error bring for from thedoes it differ alex friedman hera? he was known for building up the investment era. when you change anything, do you need to? >> this is a natural transition. alex and i have been investing together for 20 years and i joined ubs with him. there is big shoes to fill. i am looking forward to it. what we see is more of an evolution. we have built up strong level process and now we have invested heavily in regional process. investing in apac, and the
2:17 am
emerging markets, and alternative assets which is an increasing focus for our clients. we are keeping things the same. we are drilling down to a more granular level in regions where our clients are experiencing growth. >> what do you make of the investment climate at the moment, how do you read the signs your given by the bond markets and the signs coming from equity markets, how strong is global growth. we are getting conflicting messages. >> it has been quite a week for data. we have a little bit of positive surprise out of china. out of the good data united states. we are waiting for the payroll this friday and we are waiting for what the ecb does. we're telling our clients to remain overweight risk assets in the back half of the year. equities and u.s. high-yield wants. we recognize for a lot of clients is feels like we are telling them to go to the gym.
2:18 am
they will be glad they did it. >> what do you expect from the ecb, what is the minimum requirement and what might shock you? we like to see is the consensus around the deposit rate and the refinancing rate lowering vat. we also like to see some mechanism that they are willing to support small businesses. strong hand ofhe mario draghi we think the markets are going to look forward to the easing bias that comes out of europe at a time when the u.s. because of its economic recovery plans to continue with the taper. >> interesting comments coming through from the former euro strength is temporary and he does not see euro strength as a reason to act. how would you interpret those views?
2:19 am
cautiousnessat the from the people, policymakers in europe has been there for a long time. let's wait and see what mario draghi has to say because that is what the markets focus on right now. >> is there any value in the european on markets with many of lows, itkets at record is not just spain and italy and greece. france, germany. where is the value in europe? >> i think lots of investors have been surprised by how well bonds have done this year. for us now going into the back half of the year as we see continued global growth we would be underweight the highest grade on's and put more of an allocation toward equities. we think that rates are going to
2:20 am
rise. >> which equities do you like? i understand the u.k. is your least preferred market as earnings continue to lag. is it the price you have to pay to get those assets? >> the thing about the u.k. market is many of the companies have their business abroad. their earnings are heard by the strength of the pound and ironically the strong recovery within the u.k.. what we prefer our u.s. equities and european equities right now. they are more exposed to cyclicals and the global growth that we see coming on. at the end of the day for equities it is going to be based on their earnings they put up. we were encouraged by the first quarter and we saw six percent earnings growth. we think that equities could achieve eight percent earnings growth over the course of this year. that is our expectation for the
2:21 am
market. >> talk to me about hedge funds. i know they are a passion of yours. what hedge fund strategies do you favor right now? seen is that for many of our clients they're looking more toward alternatives because they continue with the search for yields. and in a diversified portfolio. there is a place for equities because the return streams are slightly uncorrelated to major asset classes like bonds and stocks. we thing now as we move from what we call an era of the fed's, an air of fundamentals. growth is driving things, not just central-bank policy. individual stocks will be less correlated. we're looking toward long short strategies and managers that can deliver alpha in. >> thank you for joining us. congratulations on the new job.
2:22 am
the global cio at ubs. >> change at the top of fox and -- foxtons. details next. ♪
2:23 am
2:24 am
>> we have had breaking news from foxton. michael brown will stay on the
2:25 am
board. jobs across the markets businesses this week. the person with knowledge on the matter said. there cutting five percent of the workforce in the region. google services in china are facing blocks ahead of mars 25th anniversary of the tenement square protests. tianamen square protests. >> welcome back. howascinating to see foxtons has fared. maybe thelked about share sale market in london is running out of steam. the saga came in at the lower end of its price range but
2:26 am
foxtons has risen. by 59%. the best performing big ipo of the last 12 months. >> no doubt helped by the numbers we have seen on the u.k. housing market. we had another illustration of the strength in the u.k. housing market. for the month of may they saw house prices rising year on year at their highest since june. a very strong performance. saw affordability being stretched outside of london. president obama is due to
2:27 am
at 9 a.m. thisw morning. we will take a look at what is on his agenda coming up next. ♪
2:28 am
2:29 am
2:30 am
x welcome back. let's head out to caroline anfor the fx check. are sparking a little high against the dollar. nationwide sang hold your horses. any sign of a slowdown in the housing market could be short-lived. unemployment is coming down. they say that will underpin demand for housing. any concerns about reining in in
2:31 am
reduces lending will not demand in any great way. we are likely to see further pressure on house prices yet further pressure on an interest rate hike. the pound is even more attractive. morning bit high this but there was a little bit of a movement with that 7:00 a.m. data. act to you. >> these are the u.s. department of justice has disabled the hacking network. announced charges. computeres urging owners to run a thorough scan to remove the viruses from their computers. a dozen people are dead in east
2:32 am
and clashesince against the russian army and insurgents. died in ale also blast that rebels say came from an airstrike. india has left interest rates unchanged. the central tank good signal it would ease monetary policy if inflation flows faster than anticipated. the reserve bank of australia kept its benchmark cash rate at a record low. >> for three decades the easiest way to obtain dual citizenship was to buy a beach house in st. kitts. national monogamy is not your thing. maybe you have a legitimate reason. you live abroad or you live and work in another country but maybe you wish to be binational
2:33 am
for more and if areas reasons. maybe like to avoid paying local taxes or you leave the double life or maybe you have needed a place to lay low. what you need is a second passport and fortunately, you can get one for cash. here is how. under most circumstances becoming a citizen of two nations is not as easy as getting google adn nnd netflix. your way let you buy and. the costs can be exorbitant. austria has a killer passport with free access to 168 countries including the u.s. but it is likely to cost $10 million
2:34 am
after you have invested some and local austrian businesses. malta has a better deal. it has a nice passport that gets you into 163 countries visa-free but it should cost you $1 million and local investments. cyprus has an eu friendly citizenship or grab at a cost audience of dollars more and given recent upheavals, may be more trouble than it is worth. for a real bargain head to the caribbean. the island nation of st. kitts has had a program that grants citizenship for as little as a $250,000 investment. the nation of antigua and matched that deal. st. kitts might have a sweeter settlement. it has no direct personal taxation whatsoever.
2:35 am
it has a four seasons resort so you can get all that visa-free travel and nonexistent taxation alongside some frozen grapes brought to you pull side. -- poolside. thaney are sunnier austria. caroline hyde is here with a look ahead to the chatham house conference. you have some notable guests. >> i will be racing down there. i will be winging my way because they have a great lineup in
2:36 am
terms of who we will be speaking to. we will be talking all things about basically the balance
2:37 am
between the east and the west. this is what they are discussing. it is the london conference. bringing together high levels of decision-makers. even talking about climate change. obama unveiling his push toward a cleaner environment. looking to dissuade call minors from pumping out as much co2. i will be speaking to simon henry. try to look at how they are pursuing and helping reduce their co2 emissions. they will get carbon capturing and a look at how they are pushing that. and a chat about how scotland versus england, if the boat would mean anything and the balance of power. how are they being affected by russia in particular at the moment. an incredible timing for this conference. it is about the geopolitical change and how we reorient ourselves in this re-balance. are we more war-like now? what are the reasons for this? is it an economic shift, do we
2:38 am
trade reorientation, will dissuade any violence between countries? discuss the rise of emerging markets. we are seeing iron ore plummeting in terms of price. will they keep on expanding in terms of the amounts of production but where will the growth come from? is china owing to be the number one economy going forward? [inaudible] manchester he like united's new manager? >> president obama is due to arrive in warsaw. we will look at what is on the agenda after the break. ♪
2:39 am
2:40 am
hotels groupnental ceo richard stallman said his company does not need a merger or takeover in order to grow. he declined to comment on
2:41 am
speculation. there have had been reports that the company had received a bid that valued it at 6 billion pounds. russia's largest search engine operator is scheduled to start trading. this coincides with the [inaudible] in amsterdam and is listed in new york. and reporting sales growth of just over 5% in the third quarter. the u.s. is continuing to grow wealth while market conditions remain more challenging in europe. >> welcome back. >> it is 741 a.m. president obama arrives in poland in over two hours. he is due to unveil a $1 billion european security fund. it is a busy few days ahead for
2:42 am
president obama. what is the message he is going to want to get across in these coming days? visit tos his second europe in 10 weeks. of marchre at the end for the nuclear security agreements. john kerry has been in europe twice. the key message is that he is coming at all because it is
2:43 am
clear the u.s. is trying to worth -- sort out what is going on in europe. there is a slight. back to europe. europe.t pivot back to dressing to window or isuropeans feel safer the substantial? polands substantial and feels the most threatened by russian expansion. european countries it might seem like window dressing. in warsaw does not look like it there. europe is depend on russian gas and you have this fragmented nature. does he have any authority to unify europe? problem is it is not unified on this issue and it cannot be unified. europe is looking to the obama administration to go ahead and go much further than europe can go themselves. more tougher in other areas. >> how much farther will he go on sanctions? >> will he apply pressure or
2:44 am
have we passed that focus point? --europe can anchor mentally obama administration will be encouraging europe to go further but there is not the unity and there is not -- there is a lot of national interest. is there significance, but can be achieved in an informal meeting? closed doors.d we have no idea what is going on. it is clear that they will come across each other. they will not meet for very long . the media will want to know what is said. probably cannot disclose what is said.
2:45 am
it will be a relatively short meeting. they have tried to keep the levels lower but it will -- [inaudible] sidentt image is presdient puting giving off here? be coming with confrontation in mind or compromise? >> putin has been relatively quiet about the results in ukraine. compromise has not exactly been his watchword so far, i think you might be coming into
2:46 am
realistic expectations of what he might get. >> we talked about symbolism with our eastern european expert. days ofes within four two massive anniversaries. given what is that to pu has happened in ukraine? >> thsese anniversaries do playa big heart in the symbolism of european politics and in the words of the european unity movement. a stance attake this time. is commentary around what has been happening in ukraine. >> there has been a lot of second world war ii-based language and putin has used that.
2:47 am
it is an interesting climate to be doing that. >> do you see a resolution to the crisis in ukraine anytime soon? >> it is a long game here. in ifimea situation, if the situation calms down, the crimea situation will be for europe and the u.s. to recognize the annexation of crimea. >> this will remain as some kind of awkward limbo for some time. >> obama needs russia to put influence on syria. within in u.s. a delicate balancing act. >> it is.
2:48 am
some were saying that russia is taken -- taking this attitude toward ukraine. obama administration when it first came in wants to reassert relations with russia. cannot accept what russia is doing in ukraine. the stock is one of our top stocks to pick.
2:49 am
that is next. ♪
2:50 am
>> welcome back. have our markets that
2:51 am
are just at i.t. group -- strategist at i.t. group. euro zone cpi and unemployment. will the cpi change? push the ecbo into action. >> it will come in lower than that 7%. i do feel that even if it does come in, they will have to make some sort of action. they will risk losing some credibility. still rather near that record high. there is still a lot of pressure on the ecb to make good on some of the problems that are affecting the eurozone. i expect to see the euro staying a little bit lower going into
2:52 am
the meeting on thursday. >> what else would you be expecting to see russia mark we can expect a rate cut certainly. this is the first time they have embarked on a negative interest rate. that is the most we have seen at this point. anyone looking for quantitative be left alone bit disappointed. we could be in for a short squeeze after the announcement is made. maybe heading back toward the 137 against the u.s. dollar. would not say will happen at this particular meeting. >> one stock you're watching is
2:53 am
fresnillo?-- fresnillo, it is down by 30% but it has a promised return to full capacity. it has a pretty good profitable return. we have seen it bounce around. as long as silver remains at 19 dollars per gram we could see a bounce at fresnillo. see some of the precious metals head up above 20 and maybe towards 1300 and gold. >> what do you make of the latest data and what kind of back drop it sets?
2:54 am
yesterday to multi month high for the more official pmi data. today it was below estimates. the market seems to be minded to like the numbers. >> it is going to spur some sort of stimulus. this is something that has been toyed with over the last few months. you look at the rba statement. there was a point made that china was slowing. the fact we did not see any interest rate move from the
2:55 am
reserve bank does lead me to believe we could be heading to a bit of ottoman in manufacturing. i do feel that at this point given that we have seen five consecutive months where it has not matched expectations that china may see some stimulus and that could be good for some of the equity and commodity prices as well. >> on the subject of interest rate moves, have you been altering your interest rate forecast for the u.k.?
2:56 am
we have further house price data showing a very strong market, prices rising to a record. many are suggesting the bank should raise rates this year. >> we have to [inaudible] prior to doing any sort of monetary policy change. it would be contradictory while we are trying to hike interest rates. hints havehat the been coming from the bank of england. it would be a gradual change.
2:57 am
see it in stages. maybe .1%. probably starting at the latter part of this year but well before the elections and it will be a small amount. i do not think they will want to rock the boat too much heading into election year in may of next year. >> joining us from her offices in london. >> "on the move" is next. on obama'ss for more visit to europe. we will see you again tomorrow. ♪ .
2:58 am
2:59 am
>> good morning. welcome to "on the move." i am guy johnson. we are moms a way from the start of the trading day. investors are focused on signs economy is stabilizing.
3:00 am
joining me now is caroline hyd


info Stream Only

Uploaded by TV Archive on